Why the Metalstech (ASX:MTC) share price is rocketing 16% on Friday

The Metalstech share price is gaining on news of its planned lithium spin-out

| More on:
Miner with thumbs up at mine

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Metalstech Ltd (ASX: MTC) share price is soaring today after the company released an update on its lithium spin-out plans.

Metalstech has set a date for its shareholders to vote on the spin-out, which would see the company's lithium assets held under Winsome Resources.

If passed, Metalstech shareholders will receive 1 Winsome share – worth 20 cents – for every 3.5 Metalstech shares in their portfolio.

Right now, the Metalstech share price is 28.5 cents, 16.33% higher than its previous close.

Let's take a closer look at today's news from the lithium, cobalt, and gold exploration company.

Shareholders to vote on lithium spin-out

The Metalstech share price is soaring today after the company announced more news of its planned lithium spin-out.

As part of the spin-out, the company will be giving its shareholders $9 million worth of Winsome shares for free.

Metalstech's shareholders will receive a combined 45 million shares in Winsome.

Shareholders will have the opportunity to vote for or against the spin-out on 4 October. Metalstech has already received indications of support for the spin-out from its major shareholders.

It has previously announced $3 million of Winsome shares will be included in a cornerstone subscription by Lithium Royalty Corp.

Metalstech has also previously stated Winsome's initial public offering (IPO) will be valued at between $12 million and $18 million.

Lithium Royalty Corp has also paid Metalstech $6.65 million for a gross revenue royalty over the Cancet, Adina, and Sirmac-Clapier lithium assets.

Metalstech share price snapshot

Today's gains included, the Metalstech share price has soared around 45% since the start of 2021.

It is also about 60% higher than it was this time last year.

At its current share price, the company has a market capitalisation of around $49 million. It has approximately 158 million shares outstanding.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Resources Shares

A happy construction worker or miner holds a fistfull of Australian money, indicating a dividends windfall
Resources Shares

Which ASX mining shares make it into the passive income elite globally?

Clue: BHP isn't one of them.

Read more »

Mining worker wearing hard hat and high vis vest holds thumbs up and smiles
Resources Shares

2 of the best ASX 200 mining stocks to buy now

These stocks are highly rated by analysts at Bell Potter. Let's see what the broker is saying about them.

Read more »

Miner holding cash which represents dividends.
Resources Shares

Could a maiden dividend soon be on the cards for this ASX mining stock?

Reinvestment in growth projects has been the company's priority up to this point

Read more »

Man in yellow hard hat looks through binoculars as man in white hard hat stands behind him and points.
Resources Shares

Pilbara Minerals shares: What the AGM revealed and what's next

Investors have plenty to digest, from updates on growth projects to the company's evolving strategy.

Read more »

Female miner in hard hat and safety vest on laptop with mining drill in background.
Resources Shares

Why this expert says it's time to sell Lynas shares

Lynas shares have come under heavy selling pressure in recent weeks.

Read more »

Business people standing at a mine site smiling.
Resources Shares

Forget Fortescue shares and buy this miner

A leading broker expects these two mining shares to trade in opposite directions.

Read more »

A mining worker wearing a white hardhat and a high vis vest stands on a platform overlooking a huge mine, thinking about what comes next.
Dividend Investing

BHP shares have fallen out of the global top 20 dividend payers. Here's why

Global dividends continue to climb.

Read more »

Miner standing in front of a vehicle at a mine site.
Resources Shares

Is the worst now over for Mineral Resources shares?

What's next for the miner?

Read more »